Stocks were little changed as investors weigh on the wave of earnings and downgraded IMF forecasts

U.S. stocks climbed on Tuesday as investors processed a deluge of earnings reports and a revised International Monetary Fund (IMF) forecast that the global economy is set to ‘slow down significantly’ amid Russia’s invasion of Europe. Ukraine.

The S&P 500 rose 1.3%, marking its best intraday session in three weeks, and the Dow Jones Industrial Average jumped 360 points. The tech-heavy Nasdaq Composite rose 1.5% after hitting a one-month low on Monday with the S&P 500. Meanwhile, Treasury yields continued to climb, the index of 10-year US benchmark exceeding 2.9%, the highest since December 2018. .

The IMF said on Tuesday it expects global GDP, a measure of economic growth, to grow 3.6% in 2022 (down from January’s projection of 4.4%) and an additional 3.6% in 2023 (also down from the last projection of 3.8%).

“This crisis is unfolding as the global economy was on the road to recovery but had not yet fully recovered from the COVID-19 pandemic,” IMF economic adviser Pierre-Olivier Gourinchas said.

Quarterly earnings from 69 S&P 500 companies are in the queue for investors to digest through Friday. Big names in the revenue ledger set to be released this week include United Airlines (UAL), American Express (AXP) and Tesla (TSLA).

Netflix (NFLX), which is expected to report quarterly results after the market close on Tuesday, will provide investors with insights into the streaming service’s post-COVID-19 slowing subscriber growth.

On Monday, 53% of the 34 companies in the S&P 500 (comprising 10% of index earnings) that said they beat both sales and earnings per share so far, the Bank of America, slightly better than the typical week 1 beat rate of 47% and the last quarter week 1 rate of 50%. The institution expects EPS above 4% in the first quarter, but anticipates downside risks to estimates for the year 2022, which implies an acceleration in earnings each quarter until next year.

“Pressure on profit margins from rising costs for virtually everything, including labor, materials and transportation, has made this quarter difficult to navigate,” LPL Financial strategists Jeff Buchbinder and Ryan Detrick. “Add in the fallout from the Russian-Ukrainian conflict and intermittent COVID-19 lockdowns in China, and corporate results are hit from multiple directions.”

“Despite the challenging environment, we believe the odds favor companies beating estimates, as they have historically driven by double-digit revenue growth,” Buchbinder and Detrick added. “High inflation translates into higher incomes, so profits can grow at a healthy pace, even with some narrowing in profit margins.”

Unlike BofA, research from FactSet suggests that while analysts have tempered their expectations for Q1 earnings, lowering the bottom-up Q1 overall EPS forecast by 0.7% from $52.21 to $51.83, EPS forecasts for the second, third and fourth quarters are higher. Earnings estimates for all of 2022 also rose 2.2% this year to $228.50 per share.

“The first takeaway for investors should be to watch how your stock reacts more than the news,” Heritage Capital Chairman Paul Schatz told Yahoo Finance Live. “If your stock is bouncing back on bad news, that’s a pretty good sign that the markets have absorbed and digested and priced in the bad news.”

11:16 a.m. ET: Investors await Netflix earnings report after the bell

Netflix (NFLX) is expected to release a quarterly report after market close. Investors are bracing for a further slowdown in growth amid the company’s exit from Russia and growing saturation in its key North American market.

Wall Street expects Netflix to post fiscal first-quarter revenue of $7.95 billion, earnings per share of $2.91 and net subscriber additions of 2.51 million.

If realized, new subscribers of 2.51 million would represent the smallest quarterly addition for Netflix since the second quarter of 2021. Subscribers increased by nearly 4 million during the same quarter last year, and at In total, Netflix had more than 220 million subscribers worldwide as of the end of the last quarter.

Netflix has grappled with slowing user growth for much of the past year, with new users slowing to a trickle after a pandemic-fueled surge in signups. But that slowdown will be further compounded by Netflix’s exit from Russia in early March, which followed the country’s invasion of Ukraine earlier this year. Cowen analyst John Blackledge estimated that Russia has around 1 million Netflix subscribers.

Shares of Netflix rose 3% during intraday trading to $347.99 per share at 11:16 a.m. ET.

9:33 a.m. ET: Stocks stagnate as investors digest earnings, IMF forecast downgraded

Here’s where the major indices were trading at Tuesday’s opening bell:

  • S&P 500 (^GSPC): +3.54 (+0.08%) to 4,395.23

  • Dow (^ DJI): +92.77 (+0.27%) to 34,504.46

  • Nasdaq (^IXIC): -18.72 (-0.14%) to 13,332.36

  • Raw (CL=F): -$3.38 (-3.12%) at $104.83 per barrel

  • Gold (CG=F): -$22.50 (-1.13%) at $1,963.90 per ounce

  • 10-year cash flow (^TNX): +4.3 bps for a yield of 2.9050%

9:08 am ET: IMF says Russian-Ukrainian war will cause ‘significant downturn’ in global economy

The International Monetary Fund (IMF) has said the global economic recovery will “slow down significantly” this year due to Russia’s invasion of Ukraine.

The IMF downgraded growth prospects in Eastern European countries, but also warned that countries around the world would be hit by the disruption in commodity markets as a result of the war. The international body now expects global GDP, a measure of economic growth, to grow 3.6% in 2022 (down from January’s projection of 4.4%) and 3. Another 6% in 2023 (also down from the last projection of 3.8%).

“This crisis is unfolding as the global economy was on the road to recovery but had not yet fully recovered from the COVID-19 pandemic,” IMF economic adviser Pierre-Olivier Gourinchas said.

Russia has seen the biggest downgrade in the IMF report, with the country’s economy now expected to contract 8.5% this year (compared to the 2.8% growth it projected before the invasion ).

8:58 a.m. ET: Housing starts rise, building permits rise in March

US residential construction activity unexpectedly picked up last month, but single-family housing starts fell due to rising mortgage rates.

The Commerce Department said housing starts rose 0.3% in March to a seasonally adjusted annual rate of 1.793 million units last month. Data for February was revised up to a rate of 1.788 million units from the 1.769 million units previously reported. Bloomberg economists expected housing starts to fall to a rate of 1.740 million units.

Permits for future housing rose 0.4% to 1.873 million units last month.

The 30-year fixed-rate mortgage averaged 5.0% in the week ended April 14, the highest since February 2011, from 4.72% the previous week, according to the mortgage finance agency Freddie Mac. Further increases are expected as the Federal Reserve moves forward with its monetary tightening plans.

7:10 a.m. ET: Stock futures near balance, Treasury yield nears 2.9%

Here’s how major benchmarks fared in premarket trading on Tuesday:

  • S&P 500 Futures Contracts (ES=F): -2.75 points (-0.06%) to 4,384.00

  • Dow futures (JM=F): -2.00 points (-0.01%) to 34,311.00

  • Nasdaq futures contracts (NQ=F): -18.25 points (-0.13%) to 13,889.50

  • Raw (CL=F): -$1.59 (-1.47%) at $106.62 per barrel

  • Gold (CG=F): -$5.00 (-0.25%) at $1,981.40 per ounce

  • 10-year cash flow (^TNX): +0.00 bps for a yield of 2.8620%

6:13 p.m. ET Monday: Futures surge as earnings season heats up

Here are the major moves in the markets ahead of overnight futures trading on Monday:

  • S&P 500 Futures Contracts (ES=F): +14.25 points (+0.32%) to 4,401.00

  • Dow futures (JM=F): +104.00 points (+0.30%) to 34,417.00

  • Nasdaq futures contracts (NQ=F): +59.50 points (+0.43%) to 13,967.25

  • Raw (CL=F): -0.77$ (-0.71%) at $107.44 per barrel

  • Gold (CG=F): -$4.90 (-0.25%) to $1,981.50 per ounce

  • 10-year cash flow (^TNX): +3.4 bps for a yield of 2.8620%

A trader works on the floor of the New York Stock Exchange (NYSE) in Manhattan, New York, U.S., April 11, 2022. REUTERS/Andrew Kelly

Alexandra Semenova is a reporter for Yahoo Finance. Follow her on Twitter @alexandraandnyc

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